When does voluntary coordination work? Evidence from area-wide pest management

Abstract

We introduce the “coordination frontier” (CF), a simple practical tool to assess the likelihood of success of voluntary coordination in situations where, ex ante, the collective action solution provides an appealing alternative (e.g., for pest and disease control). We demonstrate the value of information conveyed by the CF, explain how to construct the CF from experimental data, and show how to apply the CF in practice. We illustrate the concept with an application to data from a framed field economic experiment, which was designed to elicit the preferences of Florida's citrus growers regarding their willingness to coordinate actions to combat citrus greening disease. This is a highly relevant case study not only because of the significant impact caused by citrus greening on Florida's citrus industry but also because a voluntary area-wide pest management program to control it had been established in 2010 and eventually failed; a similar program is now in place in California, where the disease spread is at an earlier stage. Had the CF been available in Florida, estimates of the (aggregate) chances of successful coordination could have been shared with growers to update their beliefs regarding the chances of successful coordination to help reduce strategic uncertainty. Policymakers in California could use the CF in such way and devise ways to encourage participation to increase the chances of reaching a desired coordination threshold.